Mining giant Rio Tinto Friday threatened to abandon Madagascar as hundreds of protesters blocked its mine compound entrance, trapping nearly 200 staff inside, including the CEO, the company said.
Local inhabitants armed with spears and slingshots have been protesting since Wednesday against the low prices the company paid to buy their land and the employment policy at its mineral sands operation near Fort-Dauphin at the island's south-east tip.
They blocked workers of Rio Tinto QIT Madagascar Minerals (QMM) inside the site, and though some were evacuated Thursday, CEO Nyfanja Rakotomalala is still trapped inside with 178 others, according to company spokesman Brechard Luc Loyola.
"If the blockage persists, QMM will be in the obligation to stop all its activities," the company said in a statement Friday.
The land dispute has raged since the Anglo-Australian resources giant set up shop in the Indian Ocean island state.
"Four hundred hectares of land were sold to build QMM's mine in 2006. The plots went for between 100 and 6,000 Malagazy ariary ($0.04 and $2.66, 0.03 euro and 2 euro) per square kilometre to different owners," said the area chief for Anosy, Guillaume Venance.
"The first sellers now demand at least 3,000 ariary ($1.33, 1 euro) per square metre," he told AFP.
A court dismissed the dispute six months ago.
"They had to lay their complaints at the time of the sale. The law only allows a review six months after the deal," Loyola told AFP.
The firm is avoiding further evacuations to avoid confrontations.
The protesters also demand the company employ more locals.
QMM mines ilmenite, a mineral used in high-tech components. The Malagasy government retains 20 percent of the project, which started production in 2009.
Fort Dauphin has 70 million tonnes of ilmenite deposits, around ten percent of the global market, which the company plans to exploit for up to 25 years.